Nov 12, 2009

On the Fortune 500 list of top industries, health insurance companies ranked 35th in profitability in 2008; their overall profit margin was 2.2 percent. They lagged far behind such industries as pharmaceuticals, profit margin 19.3 percent, railroads (12.6 percent), and mining (11.5 percent). Among health insurers, the best performer last year was HealthSpring, which showed a profit of 5.4 percent. “That’s a less profitable margin,’’ AP noted, “than was achieved by the makers of Tupperware, Clorox bleach, and Molson and Coors beers.’’

For the most recent quarter of 2009, health-insurance plans earned profits of only 3.3 percent, ranking them 86th on the expanded Yahoo! Finance list of US industries. Makers of software applications, by contrast, are pulling in profits of nearly 22 percent.